UK food group plans to invest in Drogheda plant

Hilton Foods, the London-listed meat processing group, has plans to invest in its Drogheda facility after it secured a new deal to supply Irish supermarket Dunnes.

The proposed investment in Drogheda comes around two years after Hilton Foods announced it was going to cut a quarter of its workforce at the plant. At the time, it had decided to cut 77 jobs from its 317-person staff.

Hilton Foods’ plan to invest in Ireland was revealed during a call with analysts who were discussing the company’s latest results.

The company also announced it was now supplying Dunnes in addition to its other Irish customer, Tesco.

In response to a question on capital expenditure, Matt Osborne, Hilton Foods’ chief financial officer, said the company had the opportunity to expand the capacity of its facility in Ireland.

Osborne later added the potential investment it is looking at would be to build capacity to help it support the volume required by two customers in Ireland, Tesco and Dunnes. In response to Osborne, Hilton Foods’ chief executive Steve Murrells described having Tesco and Dunnes onboard as exciting in the context of their growth.

“As Matt says, that’s where we’re going to lay some investment down this year to capitalise on the growth,” he said. “And, of course, growing the facility in the south allows us to serve both the south and the North.”

On the Dunnes deal, Murrells said Tesco “could see the opportunity of bringing Dunnes in and the efficiency that that would bring overall”.

“And so they were encouraging of us to go and attract them into Drogheda, the facility we have in the south. And equally, Dunnes were highly complimentary of what we were producing for Tesco.

“So it’s been a win-win. It’s a business that we’ve not traded with in the past. We like the family. We like their stores. They are trading very well in the south. And as I say, it complements the capability that we’ve got, and it works for both retail partners.”

Hilton Foods’ posted a pretax profit of £66m (€77m) for 2023, up 19pc.